Question

A local cable company, the sole provider of cable television service, is regulated by the municipal government. The owner of the company claims that she is normally opposed to regulation by government, but asserts that regulation is necessary because local residents would not want a large number of different cables crisscrossing the city. Why do you think the owner is defending regulation by the city?

Short answer

The owner justifies the regulating regime, citing monopoly rights granted by the town to provide cable services.

Step-by-step solution

Introduction

The owner of a local cable company is defending laws because he or she has monopolistic rights to supply cable services in a specific area.

Given Information 

-The municipal government regulates the lone provider of cable television service. Local inhabitants do not want a huge number of various cables crisscrossing the city, thus regulation is required.

Explanation

A significant number of cable service providers may emerge if no limits are implemented. Municipal regulation benefited the owner of a local cable company who was granted monopoly authority to provide cable services.

As a result, the owner defends the regulation policy, citing the municipality's monopoly rights to provide cable services.